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Discovering the Power of Property Rights and Physics on the Web

We take certain things for granted in the physical world. The lack of the same things in our digital worlds is a limitation. Web3 will change that.

This paraphrases a quote from Tom Bilyeu, entrepreneur and builder of Impact Theory. The words stuck with me, and I've noodled on the idea for some time.

What does it mean? 

How can digital words be more like matter?

It comes down to two things. Two core concepts in our physical worlds that we lack in our digital ones. We take them for granted in our physical world. We haven't questioned why we don't have them digitally until now.

  • Property Rights

  • Laws of Physics (or a digital equivalent)

The most thrilling aspect of web3 is that it bridges the gap between the physical and digital worlds. How? By introducing those same elements.

Ownership Matters

Property rights – owning stuff – is a crucial feature of our lives. We own things, like real estate. Cars, TVs, and...things. Things that are useful, but also things that are constructs of our identities. Signal to the outside world. Like a bag or a sneaker from a specific brand.

Ownership is predictable. If you own a pair of Nike sneakers today, you can go to bed tonight, wake up tomorrow and still own the same sneakers. Seems trivial, right? It is. But in our digital world, it is not. We'll get back to that.

Laws of Physics Matters

Laws of physics are also predictable. Gravity is the same for everyone. The world is persistent. If you punch a hole in a wall, leave the room and return the next day, the hole is still there.

Here's a seemingly obvious example of how those two concepts create predictability, sameness, and a foundation for us to interact:

  • I hold an apple in my hand (ownership)

  • You can't hold the same apple in your hand at the same time. You can hold a different apple that looks the same. But it's not the same apple.

  • I can give my apple to you. Now you would have the apple, but I don't.

  • If I drop the apple. It falls to the ground. (Laws of physics).

  • If you pick up the apple and drop it, it will fall to the ground again because of the same gravitational forces.

Imagine instead that I held that apple. And then you hold it at the same time. Who's got the apple? You. Me. Everyone?!

I drop my apple, and it falls to the ground. You drop yours, and it flies to the ceiling. Suddenly, someone else comes into the room. She snaps her fingers, and both apples disappear. It's all pretty chaotic. Please, wake me up, Leo. 

We take gravity and property rights for granted. They form a predictable foundation. It's predictable because it's the same for everyone. And because it's persistent.

For instance, it would be difficult to construct buildings if gravitational forces kept reversing at random times. Or, it would be difficult to standardize, optimize and teach how to build structures safely if gravitational forces were different in different places.

The Internet of Rental

This isn't the lead-up to a sci-fi novel, so what's with all this mumbo jumbo? Because the internet works like this today. No ownership, no laws of physics. A different sense of "gravity" from one place to the next.

On the internet, we don't own; we rent. 

Do you have a Twitter account with thousands of followers? Great, but it's not yours. You're merely renting that name and the digital space from Twitter (well, technically from Elon Musk shuddering). 

Twitter could decide to recall that name and space when it wants to. And you would lose your audience in a second. How predictable is that?

There are few digital versions of the "laws of physics." Ground rules that persist. "The laws of physics" online are isolated to each destination and change between them. An apple falls to the floor in one room and to the ceiling in the next.

A More Predictable Internet

Web3 technology can introduce the same predictability we have in our physical world to the digital. An immutable, public ledger on a blockchain governs ownership and rules. 

It can record what happens and introduce the same persistence and sameness we experience in real life.

Adding these components to the internet and using them to craft new experiences will change it entirely. We'll be able to add layers of history, items, and reputation to our identity. And then traverse the internet with that identity.

Enabling a way to "show up as ourselves" at different destinations in a previously impossible way. We'll go from an internet of information on webpages to an internet of people, destinations, and things.

You don't care about digital identity, you say? What's the first thing you check when you wake up in the morning? Chances are it's your phone.

We don't use the framing of "digital identity" when we check our email. But, it kinda is. Your phone is your main point of access to the digital part of your life. Chances are, that part of your life already holds significant meaning for you.

The lines between our lives' physical and digital parts will continue to blur and melt together. This is "extra true" as younger, internet-native generations grow up to make up the majority of the workforce and, with that, consumer purchasing power. The "mainstream user base" of the future is all digital natives. 

The Only Way Is Forward

Web3 represents the edge of tomorrow. It’s par for the course that some are skeptical. And it’s healthy to ask questions. Just like people questioned websites in the 90s. Nobody predicted that we would use websites to shop, to have video calls, and so on.

We find ourselves in the same place now. We have these new building blocks, but it's hard to imagine what we'll build with them. That's what makes it so exciting to be here already.

In order to discover the right things to build in the future, it’s helpful to use a mental model with more depth than “it’s just expensive JPEGs”.

So, with digital laws of physics, predictability and ownership, what are you going to build?

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